Higher debt and operating expenses in the first quarter caused Portland-based veterinary technology and services provider Covetrus Inc. to post a net loss of $33 million despite increased sales, the company reported Thursday.

Covetrus reported revenue of $1.07 billion for the quarter ending March 31, an increase of 13 percent compared with the first quarter of 2019. It said the sales increase reflected the positive momentum the business had entering 2020.

In addition, March sales benefited from accelerating prescription management growth and certain customer inventory-stocking activity in connection with the COVID-19 pandemic, Covetrus said.

However, the company reported a net loss of $33 million for the quarter, or 30 cents per share, compared with a net loss of $13 million, or 14 cents per share, in the first quarter of 2019.

Covetrus said the primary driver of the year-over-year decline was increased general and administrative expenses, including “transaction-related” and strategic consulting costs, and higher interest expense, which offset the gross profit from increased sales.

The transactions Covetrus referred to are likely the sale of Scil Animal Care Co., a health analytics provider it sold for $125 million in January to Heska Co. of Colorado, and Covetrus’ acquisition that same month of a controlling interest in Distrivet, a Spanish veterinary products and services company.


Covetrus went through a series of executive-level shakeups in the latter half of 2019, following poor results in its first full quarter of operations, and allegations that the company misled investors about the strength of its business at launch.

Company co-founder Benjamin Shaw stepped down as CEO in October, followed by the company’s executive vice president and chief financial officer, board chairman and global supply chain officer.

Covetrus was was formed through a merger between Portland’s Vets First Choice and New York-based Henry Schein Animal Health early last year. The company’s shares trade on the Nasdaq Stock Market under the symbol CVET.

Over the past year, Covetrus shares have declined in value from a high of about $29 to a low of about $4. As of market close Thursday, prior to the quarterly earnings report’s release, Covetrus stock was priced at $11.21 per share. The price had risen to $12.18 per share by the end of trading Friday.

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